Chen Inc. accepted a two-year noninterest-bearing note for $605,000 on January 1, 2016. The note was accepted as payment for merchandise with a fair value of $500,000. The effective interest rate is 10%.
1. The cash collection on December 31, 2017, would be recorded as:
a) Cash 605,000
Discount on note receivable 105,000
Note receivable 605,000
Interest revenue 105,000
b) Cash 605,000
Note receivable 500,000
Discount on note receivable 105,000
c) Cash 605,000
Note receivable 605,000
d) Discount on note receivable 55,000
Cash 605,000
Note receivable 605,000
Interest revenue 55,000
2. The entry to record interest on December 31, 2016 would be:
a) Discount on note receivable 50,000
Note receivable 50,000
b) Cash 50,000
Discount on note receivable 50,000
c) Discount on note receivable 50,000
Interest revenue 50,000
d) Cash 50,000
Interest receivable 50,000

Assume the perpetual inventory method is used. 1) the company purchased $12,500 of merchandise on account under terms 2/10, n/30. 2) the company returned $1,200 of merchandise to the supplier before payment was made. 3) the liability was paid within the discount period. 4) all of the merchandise purchased was sold for $18,800 cash. what effect will the return of merchandise to the supplier have on the accounting equation?

Expert computers was started in 2018. the company experienced the following accounting events during its first year of operation: started business when it acquired $40,000 cash from the issue of common stock. purchased merchandise with a list price of $32,000 on account, terms 2/10, n/30. paid off one-half of the accounts payable balance within the discount period. sold merchandise on account for $28,000. credit terms were 1/20, n/30. the merchandise had cost expert computers $16,000. collected cash from the account receivable within the discount period. paid $2,100 cash for operating expenses. paid the balance due on accounts payable. the payment was not made within the discount period. required record the events in a horizontal statements model below. in the cash flows column, use the letters oa to designate operating activity, ia for investing activity, fa for financing activity, or nc for net change in cash. if the account is not affected by the event, leave the cell blank. the first event is recorded as an example. what is the amount of gross margin for the period? what is the net income for the period?

Question 1 2 points is the concern of business for the long-range welfare of both the company and its relationships to the society within which it operates